Calibrate Fines to Defendants’ Ability to Pay and Eliminate Fees

The criminal justice system has become increasingly reliant on funding from fines and fees collected from defendants, many of whom are financially struggling. Criminal fines are monetary sanctions prescribed by courts as punishment for committing a crime, and court fees are flat fees that defendants are required to pay, intended to offset court costs. In many cases, defendants unable to pay their fines and fees are simply locked up, turning jails into modern day debtors’ prisons, with defendants racking up even more fees they cannot possibly repay.

The criminal justice system—and the courts specifically—should not rely on funding from fines and fees collected from defendants. These fines and fees disproportionately impact the poor, especially given that fines and fees are generally imposed without regard to a defendant’s ability to pay them. What is required is a calibration of fines commensurate with a defendant’s ability to pay them, and the elimination of court fees.

The National Landscape

In The News

“'There are fees being assessed when our clients clearly can’t afford to pay them,' said Public Defender Brendon Woods. 'Even what seems like a nominal fee — $300, $400 — that is a huge amount to our clients, who barely have an income as it is.'”

“For fine-only offenses, jail time only comes into the picture when someone doesn't pay their fine — a risk borne by thousands of Texans, according to a recently released report by Texas Appleseed and the Texas Fair Defense Project. Those who can't afford to pay often find themselves hit with additional fines or other restrictions, such as being blocked from renewing their driver's licenses and vehicle registrations. Critics call it debtors' prison.”

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FAQ

Who does this help?

This proposal helps all citizens. By decreasing reliance on fines and fee revenue to fund the courts and the criminal justice system, this proposal shifts law enforcement time and energy towards more serious public safety threats, and shifts courts and correctional agencies resources away from fee collection and towards public safety and rehabilitation. This proposal also helps lower-income individuals, families and communities, by preventing modern day debtors’ prisons and cycles of burdensome debt that people don’t have the means to pay.

How would this work?

The legislation requires that fines be assessed as a percentage of a defendant’s income and with reference to the number of days of income a person must forego to pay them. This kind of calibration is commonly referred to as a “day fine.” Calculations of such fines are relatively simple as they depend on the defendant’s income and other assets. The legislation also repeals all criminal justice fees, surcharges or other costs.

Model Policy

Title: The Proportional Fines and Fee Elimination Act

Purpose: To establish a proportional fines program and eliminate fees to more fairly dispense justice.

Section 1. DefinitionsAs used in this section, the following terms shall have the meanings set forth herein:

(a) “Net Income.”

(1) The defendant’s self-reported income after taxes [a], from whatever source derived, whether lawful or unlawful, supported by a sworn affidavit, for the one (1) year period immediately preceding the date on which the offense was committed, minus Deductions [b]. This value may be adjusted upward or downward by the court, at its discretion, based on clear and convincing evidence that the defendant earned income of a different amount. The court may also, at its discretion, adjust this value downward to reflect a change in circumstances that would affect or otherwise cause past income to inaccurately represent the defendant’s average income [c].

(2) For individuals with no, de minimis, or unascertainable [d] income, Net Income shall be calculated using the defendant’s self-reported amount of benefits received for the one (1) year period immediately preceding the date on which the offense was committed, minus Deductions. The Court may, in its discretion, adjust this value downward to reflect circumstances that would cause a defendant’s benefit amount to inaccurately represent the defendant’s income.

(b) “Deductions [e].” The following deductions shall be applied when calculating Net Income [f]:

(1) Any Debt Payments, provided that a sworn affidavit or other comparable proof of such Payments is provided.

(2) Fifteen percent (15%) of the defendant’s after-tax income for self-support;

(3) Fifteen percent (15%) of the defendant’s after-tax income for the needs of a dependent spouse;

(4) Fifteen percent (15%) of the defendant’s after-tax income for the needs of the first non-spouse dependent;

(5) Ten percent (10%) of the defendant’s after-tax income for the needs of the second dependent and ten percent (10%) of the defendant’s after-tax income for the needs of the third dependent;

(6) Five percent (5%) of the defendant’s after-tax income for the needs of each additional dependent;

(7) After applying all other deductions:

(A) From that portion of an individual’s remaining income that is below the Federal poverty line, sixty percent (60%) shall be deducted.

(B) From that portion of an individual’s remaining income that is above the Federal poverty line but is below two hundred percent (200%) of the Federal poverty line, forty percent (40%) shall be deducted.

(C) From that portion of an individual’s remaining income that is above two hundred percent (200%) of the Federal poverty line but below four hundred percent (400%) of the Federal poverty line, twenty percent (20%) shall be deducted [g].

(c) “Debt Payments.”

(1) Any payments, including other criminal justice debt, but with the exception of mortgages, in the preceding one (1) year period, calculated from the date on which the fine is assessed, made to service or pay down a debt, or that are otherwise required by any debt instrument.

(2) In the event that a defendant has a preexisting debt, has not serviced or otherwise paid down such debt, but will, by the terms of the debt instrument, be required to make payments in the one (1) year period following the date on which the fine is assessed, such mandatory payments qualify as Debt Payments [h].

(1) All misdemeanors and felonies, as currently defined in the criminal code, any amendments thereto, or any successor statutes [i].

(2) All violations, citations, or any other unlawful act categorized as less severe than a misdemeanor or felony.

(f) “Offense Unit.” An integer between one (1) and one hundred and twenty (120).

(g) “Proportional Fine.” The Proportional Fine shall be equal to the product of:

(1) The applicable Offense Unit [j]; and

(2) The quotient of

(A) The Net Income of the defendant and

(B) Three hundred sixty-five (365).

Section 2. The Proportional Fine Commission.

(a) The Proportional Fine Commission shall be tasked with assigning Offense Units to all Offenses and implementing proportional fines systems throughout the State [a].

(b) The Commission shall be appointed by the Governor, with the advice and consent of the State Senate, and shall consist of a group of stakeholders that endeavors to include the following:

(1) A judge;

(2) A prosecutor;

(3) A member of the public defense bar;

(4) A member of the private defense bar;

(5) A director, executive, or other high-level officer of a pretrial services agency;

(6) A probation officer;

(7) A director, executive, or other high-level officer of a public aid, welfare, or other organization serving low-income communities;

(8) An expert or professor of law specializing in a field relevant to the work of the Commission, such as sentencing or criminology [b]; and

(9) Research staff to collect, review, and make publicly available all data related to fines assessed under this Act.

(c) Each member of the Commission shall be appointed to a term of five (5) years, and may be reappointed for one additional term.

(d) The Commission shall make available to the public a list of all Offenses to which this section applies and the number of Offense Units assigned to each Offense.

(e) The Commission shall convene no less than every two (2) years to review and, if necessary, revise, the number of Offense Units assigned to each Offense. If the legislature creates a new Offense, the Commission shall convene within forty-five (45) days to assign Offense Units to that Offense, and must publish a revised list of Offenses and Offense Units within seventy-five (75) days of the enactment of the law that created the new Offense, including such new Offense on the revised list.

(f) The Commission shall collect and make publicly available data related to all fines assessed under this Act, including data broken down by the demographic variables of race and income. Such data collection and publication shall include, but is not limited to, rates at which defendants pay fines; average and median fine amounts for each Offense; and demographic information and its relation to fines assessed and payment rates.

(g) Members of the Commission shall not receive any form of compensation for their service on the Commission.

Section 3. Assessing the Proportional Fine.

(a) For a qualifying Offense, the court shall assess a Proportional Fine.

(1) The court may, in its discretion, increase or decrease the number of Offense Units used to calculate the Proportional Fine, according to the totality of the circumstances of the case before the court, but in no event shall the court increase the number of Offense Units by more than ten percent (10%) of the Offense Units assigned to the Offense by the Commission. Where the number of offense units is adjusted by the Court, the Court shall document the reasons for this adjustment.

(2) The Court must make any adjustment to Offense Units prior to and separately from assessment of the Proportional Fine.

(3) Any defendant can apply to convert their Proportional Fine to programmatic participation or community service hours.

(b) Separate and apart from the procedure described in Section 3(a), if the court finds that imposition of a Proportional Fine would be grossly disproportionate to a defendant’s ability to pay, based on the totality of the circumstances, then the court may assess a lower fine.

(c) All fines assessed under this section must be paid within two (2) years, or, if a defendant is incarcerated when the fine is assessed, within two (2) year of release from a correctional facility, unless application is made to the court by the defendant and good cause for an extension is shown. The court may, in its discretion, extend the date by which the fine must be paid. The court may authorize payment in installments. The court shall not require court appearances for applications for extensions.

(1) Notice must be provided no less than thirty (30) days and again no less than fifteen (15) days before payment is due if payment has not yet been made. In no event shall a court appearance be required to make a payment. In no event shall payment be due unless notice has been provided at least twice.

(2) In addition to any other authorized form of payment, payment of all fines assessed under this section by mail, in-person, and through an electronic payment system must be permitted. No surcharge or other additional fees may be assessed for using a particular form of authorized payment [a].

(d) For any defendant whose Net Income is calculated under Section 1(a)(2), and any defendant who applies to convert their Proportional Fine to programmatic participation or community service hours pursuant to Section 3(a)(3), the court shall, in lieu of any other fine assessed under this section, order a number of hours of programmatic participation or community service equal to the quotient of (a) half the Proportional Fine and (b) an imputed wage of twenty (20) dollars per hour. Community service or programmatic participation ordered under this section must be imposed to be proportionate to the offense and so as not to unreasonably interfere with any other employment, travel restrictions, or family care responsibilities. Judges can, in their discretion, determine which type of programmatic participation or community service to assign to a given defendant. Programmatic participation includes, but is not limited to, participation in the following:

(1) drug treatment programs;

(2) mental health treatment programs;

(3) educational programs;

(4) job training or readiness programs; or

(5) appointments or coaching with social workers, including for the purposes of discussing access to public benefits.

(e) For defendants who fail to report their income, or who deliberately mislead the court as to their income, the court may, in its discretion, apply the maximum allowable fine for the applicable Offense, without deduction or adjustment, unless the defendant demonstrates by a preponderance of the evidence why she is unable to report her income to the court.

(f) All revenues from Proportional Fines should be deposited in the State’s general revenue fund.

Section 4. Repeal of Other Fines.For all Offenses, the provisions of this section shall govern as to the assessment of fines. All other provisions related to the assessment of fines in relation to any Offense are hereby repealed.

Section 5. Repeal of Fees.Any provisions related to the assessment of criminal justice fees, surcharges, or costs are hereby repealed. The State’s criminal justice system shall be funded by the State’s general taxation system and Proportional Fine revenues, not by user fees, surcharges, or costs.

COMMENTARY

Section 1.Comment a: Jurisdictions are encouraged to use a standardized form with guided questions as the basis for identifying self-reported income. Defendants should not be required to provide tax returns, although may provide tax returns in lieu of the standardized form.

Comment b: Given that defendants may not have tax returns, and may only have recent paystubs, Defendants may use self-reported income after taxes for the one (1) month period, rather than one (1) year period, immediately preceding the date on which the offense was committed, and this amount can be multiplied by twelve to calculate net income.

Comment c: A change in circumstances includes, but is not limited to, the loss of a job, a temporary disability or medical event that limits one’s ability to work, or other similar events.

Comment d: “Unascertainable” includes individuals for whom there is no unreported or misreported income. This is intended to apply to individuals who do not report any income and are unable to or otherwise do not provide evidence of hidden or underreported income. Net Income should not be calculated pursuant to subsection (a)(2) for individuals with substantial hidden assets.

Comment e: “Dependent,” “dependent spouse,” and related terms left undefined here should be interpreted consistently with applicable State or Federal law.

Sample Deduction Calculation:

Assuming a verified, self-reported gross income of $60,000; $2,000 in debt at the time of the Offense, a dependent spouse and no dependent children, and, for simplicity’s sake, an applicable Federal poverty line of $10,000, Net Income would be calculated as follows:

The first deduction under clause (b)(7), 60% * $10,000, is for the portion of the income, after deductions in clauses (b)(1), (b)(2) and (b)(3), that is below the Federal poverty line. The second deduction, 40% * 10,000, is for the portion of the income between the Federal poverty and twice the Federal poverty line (i.e. 200% of the Federal poverty line). The third deduction, 20% * $20,000, is for the portion of the income between twice the Federal poverty line and four times the Federal poverty line. Because this individual’s income, after deductions in clauses (b)(1) through (b)(6), exceeds $40,000, and continuing to assume a Federal poverty line of $10,000, no additional deductions would be permitted on post-deduction income above $40,000.

Comment f: Jurisdictions, especially those with high costs of living, are encouraged to consider applying additional deductions for expenditures on basic needs.

Comment g: The Federal poverty line varies with family size, and so its use in this model is intentional. However, the Federal poverty line does not reflect local income levels or variations in local purchasing power, which could lead to inequitable outcomes. This could be addressed by considering per-capita incomes in a given jurisdiction. Alternatively, if a state- or local-level poverty line exists, legislators are encouraged to use this measure of calculation in lieu of the Federal poverty line. If legislators decide to use a more targeted metric for establishing poverty deductions, they should ensure that the metric takes into account family size.

Comment h: The “debt payments” provision is primarily meant to apply to student debt and/or other structured debts. For example, in the case of student debt, a student may incur debt but will not be required to pay off their loans until he or she has graduated. Absent this provision, a recent graduate who commits an Offense would not be able to deduct the payments he or she would necessarily make on student loans following graduation because he or she would not have made any payments in the preceding year. Therefore, this provision enables individuals in this or other similar situations to deduct required, but not yet paid, debt payments.

Comment i: Jurisdictions may deem it appropriate to exclude certain offenses, such as violent felonies, from this legislation. However, legislators should be cognizant of the tension between the goals of this legislation and the detrimental consequences of penalizing people who have already served a lengthy prison sentence and will likely be unable to pay a substantial fine after a period of prolonged unemployment.

Comment j: Sample Proportional Fine Calculation:

Assuming Net Income of $20,000 per year, and the Offense committed is assigned 50 Offense Units, then the Proportional Fine calculation would proceed as follows:

$20,000 / 365 days = $54.79 per day

$54.79 * 50 Offense Units = $2,739 day-fine assessment

Section 2.Comment a: To the extent that a commission resembling the Proportional Fine Commission exists within a jurisdiction, such as a sentencing commission, such jurisdiction should not task that existing commission with the responsibilities set forth under Section 2.

Comment b: If implemented at the municipal or county level, the highest executive officer of the state will be responsible for appointments, and the county board, city council, or equivalent body will approve such appointments. Similarly, the titles for the members of the Fine Commission should be adjusted for the specific jurisdiction.